Shekhawati Poly Yarn Ltd Management Discussions.
Management Discussion and Analysis mainly comprises of the statements which inter alia involve predictions and projections based on perceptions and may, therefore, attract certain risks and uncertainties. It is the sum total of the Companys expectations, beliefs, estimates and projections which may be forward looking within the meaning of applicable securities, laws and regulations. The actual result could differ materially from those expressed herein specifically or impliedly.
The important factors that could make a difference to the Companys operations include availability and cost of raw material, cyclical demand and pricing in the Companys principal markets, changes in government regulations, tax regimes, economics developments within India and countries in which the Company conducts business, Indias Free Trade Agreements with other countries, prevailing exchange rate of INR against other currencies, availability of skilled and unskilled workforce and other incidental factors. The shareholders are cautioned to use this in conjunction with the Companys financial statements.
India is the worlds second largest producer of textiles after China. Indian textile industry currently estimated to be US $108 billion and expected to reach US $209 billion in the year 2021.The industry is the second largest employment generator after agriculture by employing 45 million people directly and 60 million people indirectly. The Indian textile industry presently contributes around 14 percent to industrial production, and 4 percent to GDP, 17 percent to the countrys exports, and 21 percent employment. Indian textile industry currently possesses a share of 4.7% in world market of textiles.
During the year under review the performance of the company slightly improved. However, further improvement was affected due to lower capacity utilization on account of limited resources available with company and slowdown in the textile industry.
A. INDUSTRIAL STRUCTURE AND DEVELOPMENT:
The textile industry has witnessed steady growth in the recent past with the friendly policies announced by the Government. The industry has undergone drastic changes over the decades, particularly after the introduction of Technology Up-gradation Funds (TUFs) scheme by the Government of India and majority of the textile companies have modernized /renovated their plants in order to provide quality products and meet the global standards.
The Indian government has come up with a number of export promotion policies for the textiles sector which encourage the textile industries to export. The Government has also allowed 100 % Foreign Direct Investment (FDI) in the Indian textiles sector under the automatic route as per FEMA Act.
Your Company work hard to meet the competition as well as to enable to maintain long standing business relationship.
B. OPPORTUNITY AND THREATS:
The economy is expected to improve its performance during the current fiscal and the textiles industry is also likely to register good growth. The Indian textile industry has its own limitations such as accesses to latest technology and failures to meet global standards in the highly competitive export market. The changing government policies at the state and central government levels are also posing major challenges to the textile industry.
The growth of Indian E-Commerce companies provides opportunities for the Indian textile industry in the domestic as well as international market.We expect the textile segments to turn favorably and based on the various factors like macro economy condition, the Company is hopeful of improved financial performance in the coming year and hope to provide good results in the forth coming years.Total export of the Company for the year 2018-19 was Rs. 569.54 Lacs.
C. RISK AND CONCERNS:
Risk taking is intrinsic to business growth. All business organization face risks either from internal operations or from external environment. The base of any business is a healthy appetite for risk. This is why one of the greatest and most important challenges for an organization is to define the optimal risk level for its business to ensure that its activities produce risk adjusted returns.
The risks for the Company is high cost of major input, viz. POY and intense competition in domestic and export markets due to large scale over capacity.
D. INTERNAL CONTROL SYSTEM:
The Board has adopted system of internal control to ensuring the orderly and efficient conduct of its business, including adherence to the Companys Policies, the safeguarding of its assets, the prevention and detection of fraud and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures. The management reviews the control systems and procedures periodically to upgrade them. Presently the internal control systems are commensurate to the size and operations of the company.
E. FINANCIAL & OPERATIONAL PERFORMANCE:
During the year under review the performance of the company slightly improved. However, further improvement was affected due to lower capacity utilization on account of limited resources available with company and slowdown in the textile industry. Company has incurred loss after tax of Rs. 926.41 lacs as against a loss after tax of Rs. 1405.92 lacs in the previous year 2017-18.The turnover of the company was Rs. 14739.28 lacs as against Rs. 14608.25 lacs in the previous year 2017-18.
F. HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS:
The Company continued to enjoy harmonious and cordial relations amongst its entire employee. The key to the success of the Company lies in its people whose skills, expertise, and talent help the Company to achieve and sustain its market position. It is the peoples commitment, technical know-how, innovative ability and performance driven mindset that enable to react swiftly and creatively to the evolving customer and market needs.
Human resources continue to be an invaluable and intangible asset and key success factor for the Company to grow and sustain its market position in a highly competitive and challenging environment. Your Company firmly believes that people are the pivotal force behind the growth and excellence in business operations. Focus on developing leadership skills and building talent for the future and the process of improving organizational and human capability through competency mapping of managerial positions in all areas of the Companys operations, continued as a major initiative. The Company is committed to provide the right environment to its employees to work and to inculcate a sense of ownership and pride.
G. CAUTIONARY STATEMENT:
Statements in this Report on Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions are based on certain assumptions and expectations of future events. Actual results could differ materially from those expressed or implied. Investors are cautioned that this discussion contains statements that involve risks and uncertainties. Words like anticipate, believe, estimate, intend, will, expect and other similar expressions are intended to identify such forward looking statements. The Company assumes no responsibility to amend, modify or revise any forward looking statements, on the basis of subsequent developments, information or events.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS For SHEKHAWATI POLY-YARN LIMITED
|Mukesh Ruia||Ravi Jogi|
|Date||: August 12, 2019||Chairman & Managing Director||Whole Time Director|
|Place||: Mumbai||(DIN : 00372083)||(DIN : 06646110)|